Nailing It Down

By Dave Murnen and Pat Beaty

Insurance is one of those things that can be hard to spend money on — but when you are in need, you will find yourself so grateful that you did.

Last week we talked about the need for — and the relatively inexpensive cost of — renters insurance. We also talked about some things that are likely not covered under your homeowner’s insurance.

And to reiterate: The average renter’s insurance costs about $125 to $300 for a year and protects your belongings and liability in case of a loss. We highly recommend it.

Also, if you have a mortgage, you almost certainly have homeowners insurance. We suggest you review it every year or so to make sure you understand what is covered.

Today we will talk about a few more insurance-related topics, including a topic we unfortunately have a bit of experience on here on the Harbor: flood insurance.

So let’s get going!

WHERE IS YOUR INSURANCE POLICY?

When disaster — big or small — hits, be it a house fire or a dishwasher that leaked all over your hardwood floors, you’ll want to have quick access to your renters or homeowners insurance policy.

Obviously, your insurance company will also have a copy. However, it is empowering and helpful to have your latest policy from the underwriter in a safe, available place.

Even if you don’t review your policy this week, at least make sure you know where it is and could quickly get your hands on it in case of emergency. Also, you may consider having more than one copy made for your safe or to store somewhere away from your house.

At the very least, program your insurance company’s name and phone number into your phone and make sure you have a business card somewhere you could grab. When stress such as a flood or fire occurs, sometimes our brains are overwhelmed and don’t remember such details.

CREDIT SCORES COME INTO PLAY

One thing not everyone knows is that how you deal with your finances and credit will directly affect how much you pay for insurance.

Insurance companies do credit checks to see how you are handling your finances. It may not seem fair or any of their business, but it is a reality. Apparently there is a statistical link between poor credit and more insurance claims.

We have some good news, however. Helping you with budgeting and working to improve your credit is something we can do for you here at NeighborWorks of Grays Harbor, and there is no cost to you for this service. Give us a call to discuss how we may be able to help you: 360-533-7828.

PRIOR CLAIMS MAKE A DIFFERENCE

Again, it may not seem fair, but if you have made a claim on your insurance policy, your rates will likely go up.

It can feel a little like you are being punished for using the thing you have been faithfully purchasing for such a time as this. However, the reasoning is again a statistical one. When someone has one claim, insurance companies have found that it becomes more likely they will have another one within a few years.

Usually the impact of a claim will last three to five years. Is your policy more expensive because of a claim a few years back? If so, bring this to your brokers’ attention and ask when this might stop affecting your premiums.

Also, if you have had a loss at a secondary house or at a storage facility containing your belongings, it will likely affect your regular home insurance premiums for a while.

FLOOD INSURANCE ON THE HARBOR

Thanks to the federal government’s re-evaluation of flood zones, flood insurance coverage around here has been in flux the last couple of years.

Susan Gihlstrom, a broker at Dave Johnson Insurance in Aberdeen, explained: “FEMA recently revamped the flood zones around here in Grays Harbor, and so fortunately some people are no longer considered in the flood zone. However, there are also now people who are now considered in the flood zone who weren’t before.

“We’re even seeing one neighbor who is no longer considered in the flood zone, and literally their next-door neighbor, who wasn’t in the flood zone before, is now considered part of it,” she said.

Likely you won’t have to figure this all out. If you have a mortgage and you are in the flood zone, the bank or credit union that has your loan will have notified you that you now need to purchase flood insurance.

While for years FEMA was the only one that sold flood insurance, albeit through different companies, now FEMA is working with private carriers to actually sell flood insurance — to spread the risk around.

All this to say, if you don’t know if your home is considered in the flood zone, it would be good to find out. However, even if you aren’t in the official flood zone, you still may want to consider flood insurance for your home.

“Just because you’re not in a flood zone doesn’t mean the area isn’t going to flood,” Gihlstrom said.

TIMELINESS IS KEY

Gihlstrom gave us some more good reminders about insurance and what you can claim and when you should claim it.

In a word, timeliness is key.

“You have to pay attention to things around and in your house, as well as read your policy,” she said. “A loss typically needs to be accidental and sudden — not due to deferred maintenance. After a big windstorm, walk around your house; take a look to see if there has been any damage.”

Also, Gihlstrom said, damage caused by mold or vermin — mice, rats and other critters — is not covered in a typical homeowners policy.

“I know of a case where mice got into a storage facility and ruined an expensive couch. It was not covered,” she said. “This is the time of year to pay close attention to that. It’s getting cold out and the animals want to come inside.”

For that reason, she noted, it’s a good idea to ensure your foundation is enclosed and you don’t have holes in any screens.

BUYING A HOME?

Are you considering buying a home? Choose to be educated about this complicated process and avoid being ripped off. Choose home-buyer education online from eHome America for $50 per person, and we will be your host housing counselor at no charge.

Dave Murnen and Pat Beaty are construction specialists at NeighborWorks of Grays Harbor County, where Murnen is executive director. This is a nonprofit organization committed to creating safe and affordable housing for all residents of Grays Harbor County. For questions about home repair, renting, remodeling or buying, call 360-533-7828 or visit 710 E. Market St. in Aberdeen. Our office is fully ADA-compliant.